Correlation Between NMI Holdings and Sino Land
Can any of the company-specific risk be diversified away by investing in both NMI Holdings and Sino Land at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining NMI Holdings and Sino Land into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NMI Holdings and Sino Land, you can compare the effects of market volatilities on NMI Holdings and Sino Land and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in NMI Holdings with a short position of Sino Land. Check out your portfolio center. Please also check ongoing floating volatility patterns of NMI Holdings and Sino Land.
Diversification Opportunities for NMI Holdings and Sino Land
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between NMI and Sino is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding NMI Holdings and Sino Land in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sino Land and NMI Holdings is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on NMI Holdings are associated (or correlated) with Sino Land. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sino Land has no effect on the direction of NMI Holdings i.e., NMI Holdings and Sino Land go up and down completely randomly.
Pair Corralation between NMI Holdings and Sino Land
Assuming the 90 days horizon NMI Holdings is expected to under-perform the Sino Land. But the stock apears to be less risky and, when comparing its historical volatility, NMI Holdings is 5.23 times less risky than Sino Land. The stock trades about -0.05 of its potential returns per unit of risk. The Sino Land is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 59.00 in Sino Land on August 25, 2024 and sell it today you would earn a total of 35.00 from holding Sino Land or generate 59.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NMI Holdings vs. Sino Land
Performance |
| Timeline |
| NMI Holdings |
| Sino Land |
NMI Holdings and Sino Land Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NMI Holdings and Sino Land
The main advantage of trading using opposite NMI Holdings and Sino Land positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NMI Holdings position performs unexpectedly, Sino Land can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Sino Land will offset losses from the drop in Sino Land's long position.| NMI Holdings vs. USWE SPORTS AB | NMI Holdings vs. GungHo Online Entertainment | NMI Holdings vs. Ming Le Sports | NMI Holdings vs. DICKS Sporting Goods |
| Sino Land vs. MGIC INVESTMENT | Sino Land vs. JIAHUA STORES | Sino Land vs. AEON STORES | Sino Land vs. Caseys General Stores |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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